Importer Blasts CBP's Failure to Apply Section 232 Exclusion on Steel Tube Imports

CBP failed to apply a Section 232 steel and aluminum tariff exclusion on G&H Diversified Manufacturing's steel tube entry, the importer argued in a Nov. 21 complaint at the Court of International Trade. G&H said CBP had said on at least three separate occasions that the classification of the imports was correct and that the classification was excluded from having to pay the national security duties as determined by the Commerce Department's Bureau of Industry and Security (G&H Diversified Manufacturing v. U.S., CIT # 22-00130).

G&H is seeking over $240,000 in refunds of Section 232 duties it paid.

The importer said BIS approved its exclusion request in December 2020 but because the entry was made before the exclusion was granted, the importer had to pay the Section 232 duties. As a result, G&H had to wait for liquidation then file a protest to obtain a refund of the duties. The importer said the Harmonized Tariff Schedule subheading on the entry matched the number on the exclusion and the notice of liquidation: 7304.29.6115, which covers goods "of a kind used in drilling for oil or gas."

G&H said CBP set the correct HTS classification for the entry at least three times -- when the exclusion request was posted, when the exclusion request was approved and when notice of liquidation was posted. Nevertheless, the agency said in denying the importer's protest that classification was proper under HTS subheading 7304.59.8020.

The four-count complaint alleges the protest denial was illegally "issued without notice to Plaintiff or an opportunity for Plaintiff to be heard regarding the reversal of CBP's earlier determinations of the proper HTSUS classification of the imported merchandise." Additionally, G&H said that subheading 7304.29.6115 is "more specific" than subheading 7304.59.8020 because the goods at issue have the "essential character of an article 'of a kind used in drilling for oil and gas.'"